Los Angeles Times

Motorists want lowdown on why gas prices are so high

- By Nathan Solis

It’s not your imaginatio­n. California, like the rest of the nation, is paying more at the pump.

Prices are so high — and consumers are so perplexed — that a Google search of “Why are gas prices going up?” has spiked this month. Likewise, people are pleading: “When are gas prices going down?” which has also been trending on Google.

The average price for a gallon of regular unleaded gasoline is $4.54 in California, which is about $1.16 higher than the national average, according to data from AAA.

But one station along the Big Sur coast was charging $7.59 a gallon for regular unleaded this week and nearly $8.50 for premium.

The Gorda by the Sea Mini Mart, situated along a remote stretch of Highway 1 in Monterey County, warns: “Next gas 40 miles north, 12 miles south.”

Though the sticker shock at Gorda’s pumps has garnered national attention, experts say those prices are an anomaly.

“99.9% of motorists are not buying gasoline over $5,” UC Berkeley economist Severin Borenstein said.

Still, prices have been increasing across the state. On Friday, the average price of a gallon of self-serve regular gasoline in Los Angeles County rose for the 11th consecutiv­e day, the largest week-to-week increase since March.

And prices in Southern California are the highest they’ve been in a decade. In L.A. and Orange counties, motorists are paying roughly $19 more to fill up a standard 14-gallon tank than they did a year ago.

“Typically we start to see prices go down after Labor Day because people have wrapped up their summer road trips,” AAA spokesman Doug Shupe said. “But this year is different.”

A jump in crude oil costs, which account for slightly more than half of the pump price, has contribute­d to soaring gasoline prices.

For much of 2020 — a year marred by the COVID-19 pandemic, stay-at-home orders and restricted travel — crude prices tanked. Last October, a barrel of crude cost just under $35, according to the Energy Informatio­n Administra­tion. A year later, crude oil futures are closer to $85 — an increase of more than 140%.

“Demand is back. It’s been a tough couple of years with the pandemic,” Shupe said. “Now, with the increased vaccinatio­ns, more people want to get out there to share the open roads with friends and family.”

California­ns have always shelled out more for gas than in other parts of the U.S. because of higher taxes and environmen­tal rules. Since 1996, cleaner-burning gasoline has cost more — but the trade-off has been cleaner skies, Borenstein said.

“Forty years ago, you couldn’t see the mountains in Los Angeles,” he said. “Now you can.”

There’s also a “mysterious gasoline surcharge” that Borenstein says appeared in 2015 that is unclear to the average consumer and even experts like himself. The high prices have been so disconcert­ing that Gov. Gavin Newsom asked the California Energy Commission for an analysis in 2019, suggesting “inappropri­ate industry practices” were driving up costs, rather than the state’s surcharges.

Experts say there should be some relief in the coming weeks when service stations in California switch over to their winter blends, which are cheaper to produce. By November, prices could drop about 12 cents, but Shupe said higher butane and crude oil costs will probably make the decrease less significan­t than in previous years.

Griping about gas prices is understand­able — and universal. But Borenstein said he has another way of looking at the numbers: “In some ways, what we’re seeing reflects some good news: The economy is coming back.”

 ?? Irfan Khan Los Angeles Times ?? THE COST of self-serve gas is displayed at a station off the 15 Freeway in Fontana. Prices in Southern California are the highest they’ve been in a decade.
Irfan Khan Los Angeles Times THE COST of self-serve gas is displayed at a station off the 15 Freeway in Fontana. Prices in Southern California are the highest they’ve been in a decade.
 ?? Google ?? THE GORDA by the Sea Mini Mart, situated along a remote stretch of Highway 1 in Monterey County, was charging $7.59 a gallon for regular unleaded this week.
Google THE GORDA by the Sea Mini Mart, situated along a remote stretch of Highway 1 in Monterey County, was charging $7.59 a gallon for regular unleaded this week.

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